CEO Notebook |
I know what financial aid looks like today for independent schools, but what is its future? Let’s first take a glimpse at the trends in higher education. Last month, an article from the Christensen Institute reported that in the 2014-15 school year, 86 percent of first-time full-time freshmen received aid of some kind. Couple this with a slightly different perspective from the most recent NACUBO Tuition Discounting Study. In 2017-18, total grant dollars awarded to undergraduates as a percentage of gross tuition and fee revenue reached nearly 50 percent for first-time, full-time freshmen.
The data for independent schools suggests that discount is not nearly that deep. According to data collected in NBOA’s Business Intelligence for Independent Schools (BIIS) data collection platform, the average discount by independent schools was 17.7 percent in 2016-17, taking into consideration financial aid, merit aid and tuition remission. But if you subscribe to the notion that higher education serves as a bellwether, the outlook is challenging.
It all raises an important question: How can our schools restrain tuition growth while meeting growing demand for tuition offsets like financial aid and tuition remission? From a purely business standpoint, we can’t. What I find most striking in the data, as pointed out specifically in the Christensen Institute article, is the shrinking number of full-pay families who bear the entire burden of our tuition increases. When you look at it from that perspective, the outlook for a sustainable financial future appears that much more daunting.
Show Them the Money: Six Trends in Financial Aid (Sept/Oct 2017)
The Art and Science of Assessing Financial Need (Sept/Oct 2016)
These are important questions that demand discussion, insight and answers, as elusive as they may appear to be. To this end, I’m very pleased to announce that during this school year, NBOA is partnering with the Enrollment Management Association to explore the drivers impacting the growing costs of delivering a world-class independent preK-12 education, along with affordability concerns for current and prospective families. Through this partnership, the associations will explore how best to identify, secure and utilize the resources an independent school needs to fulfill its mission and provide unparalleled education to its students. The ultimate goal for NBOA’s and EMA’s combined membership is to help schools achieve, maintain and grow enrollment of mission-aligned students and thrive in perpetuity as financially sustainable educational institutions.
Both associations will leverage their various platforms and deliver thought leadership and guidance through a series of offerings kicking off this week. EMA’s annual conference will feature a panel discussion focusing on financial aid with NBOA’s own Jennifer Hillen and Dallas Joseph of the Baylor School (and former NBOA Board Chair). And this is just the beginning. On an ongoing basis, both associations will be leveraging online and printed resources to help school leaders explore issues related to financial aid in particular, as well as current market conditions, pricing, enrollment, accessibility and affordability trends. There will also be a follow-up panel discussion at the 2019 NBOA Annual Meeting, March 3-6, 2019, in San Diego. In short, we are bringing this predominant issue into the limelight so your independent school, and others like it, may identify the most viable path forward.
As I frequently share, the solutions to our school’s most pressing challenges can’t be solved by one individual on your campus, or even one independent school association. That is why NBOA and EMA are modeling what ought to be happening at your schools to address one of the most vexing imperatives of our time.
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